The Austrian government - who have heretofore plied Heta with €5.5 billion - held an emergency meeting to discuss the development. They concluded that they would not hand over "a single euro" to the...

After trading at its steepest (short-term volatility lowest vs medium-term volatility) in 5 months last Monday, VIX rallied notably (and the curve flattened) on the week to 2015 lows. At the same time, in the 'traded' VIX product world, 2 rather notable things happened: first, VIX futures, which were at a record net long positioning at the end of January, have plunged to a net negative (short VIX) positioning once again; and second, and more stunningly, VXX (the VIX ETF) saw the biggest surge in units created since record began. Between these violent swings and the push-pull weights of oil's high vol and AAPL dominance of any dispersion, we suspect VVIX (vol of vol) will pick up notably from its 3-month lows. However, it is the fragility that this kind of move exposes that worries us the most.

Even a brief glance at the facts suffices. Portugal is no less bankrupt than Greece. The country’s government debt, at 124% of GDP, might be lower than in Greece. However, government debt is just one – even though important – part of the full debt picture. On an aggregate level, Portugal’s overall debt level - at 381% of GDP when also including private households and non-financial corporations - is well above Greece’s total debt level (286% of GDP). So while Greece’s problems mainly manifest themselves via government debt, Portugal suffers from too much debt in all three sectors of the economy.

"The diversified hedge fund index was up 0.4% for the month of February, while the S&P 500 was up 6.0% on a price returns basis. CTAs unperformed the most in the month, down 1.9%, while Event Driven were up 2.4%."

As Russia announces the expansion of its Navy by 50 vessels this year, including two new nuclear-powered submarines and an aircraft carrier, it appears NATO's sabre-rattling has drawn a response/threat/warning. Following British plans to send military 'advisers' into Ukraine (which NATO has stated are not confirmed), TASS reports, Russia's NATO envoy, Alexander Grushko, warns Russia will take all measures against possible NATO threat in Ukraine, adding that Russia’s response may include military measures. Of course all this military machismo comes as Russia and Ukraine hold emergency talks in Brussels over gas supply amid imminent cutoff threats for non-payment.

No matter how much oil the United States produces over the next few years, it will never become the next Saudi Arabia in the global oil market, according to Fatih Birol, the new executive director of the International Energy Agency (IEA). What's especially interesting about this forecast is that it directly contradicts what Birol said only three months ago, and he gave no explanation for his change of mind. “The United States will never be a major oil exporter. Their import needs are getting less but the US is not becoming Saudi Arabia,” Birol told the conference. “Their production growth is good to diversify the market but it will not solve the world’s oil problems.”

"None dare call it a “currency war” because that would be counter to G-10/G-20 policy statements that stress cooperation as opposed to “every country for itself”, but an undeclared currency war is what the world is experiencing. Close to the same thing happened in the 1930’s, a period remarkably similar to what many countries’ policies resemble today.... Negative/zero bound interest rates may exacerbate, instead of stimulate low growth rates in all of these instances, by raising savings and deferring consumption... Asset prices for stocks, high yield bonds and other supposed 5-10% returning investments, become stretched and bubble sensitive; Debt accumulates instead of being paid off because rates are too low to pass up – corporate bond sales leading to stock buybacks being the best example. The financial system has become increasingly vulnerable only six years after its last collapse in 2009.... Central banks have gone and continue to go too far in their misguided efforts to support future economic growth."

The deterioration in the subprime auto market is perhaps the clearest sign yet that we have learned literally nothing from the crisis years. That is, this is precisely the same dynamic and it will end precisely the same way: defaults will rise, investors in assets backed by these loans will suffer outsized losses, and the assets themselves will become completely illiquid.

With Philly Fed's 10th president, Charles Plosser retiring effective March 1, 2015, algos were wondering if he would be replaced with another former Goldman partner, or if his seat would be filled with yet another academic. The answer, as the Pgilly Fed reported moments ago, is the latter. Meet the new president of the Philly Fed: Patrick T. Harker, 56, currently president of the University of Delaware, former dean of the Wharton School at UPenn, and a member of the Philadelphia Fed's board of directors. His career academic background: Harker has a Ph.D. in civil and urban engineering, a master's degree in economics, and an M.S.E. and B.S.E. in civil engineering from the University of Pennsylvania. Wait, so no econ PhD? There may be some hope yet...